While learning about stocks and the stock
market is a great way to learn about the economy and how business
works, investing in individual stocks is not necessarily the best
investment choice for most people, unless they are getting advice
from an experienced and trusted professional. For most
individuals who want to invest in the stock market, low priced
index funds provide a low cost and more simple way to invest in a
diversified portfolio of stocks.

What is a stock?

A stock represent a share in the ownership of a
company. If you own a company's stock, then you are a owner, or
shareholder, of the company. A stock represents a claim on the
company's assets and profits. A stock is also known as equity.

The ownership percent, of a company that you own is calculated by
dividing the number of shares a person owns buy the number of
shares of stock outstanding.

For example:

1000 shares owned
10,000 shares outstanding

= 10% ownership.

Ownership of stock is represented by a stock certificate. A stock
certificate represents your ownership of the company. These days,
when you buy stock of a company, you usually do not get the actual
stock certificates any more. Instead, your ownership is tracked
electronically, making it easier to buy and sell shares.

So, now that you have stock and ownership of a company, what can
you do? Not really very much. You will benefit when the price of
the stock goes up, or lose if the price goes down. As an
part-owner of the company, you are given the right to vote for
company's board of directors.

Another way you may benefit is if the company pays dividends.
Dividends represent a percent of the company's profit, paid to the
shareholders.

Buying stock can be risky, since while the price of the stock may
go up, it may also go down. If the company goes bankrupt, then you
could potentially lose all the money you invested in the stock.
However, that is what investing is all about. Taking risks, in the
hope of making money on your investment, with no guarantee that
you will make money.

The following worksheets provide an opportunity
to practice your understanding of stocks. Many of these worksheets are RANDOM and
customizable, so you may print out several different versions
depending on the skill level of your students.